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Why Invest in IACI? The Street’s View Our View Match Group’s growth slowed to 9.5% in Q2, and many fear growth will continue to fall IAC is compared to business like AOL and Yahoo, which trade at ~6.4x and 5.5x EV/EBITDA View company as a Search and Applications business first and foremost Google negotiated more restrictive download policies and implemented new advertising policies, adversely affecting this segment Management expects applications revenue to fall 20% before resuming growth in 2015 Strong long-term prospects for Match Group over time due to subscriber growth and operating leverage Significant value in Search business despite headwinds in Applications 58% of IAC’s value is locked in the Match Group

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Applications

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Queries down 15% in 1H 2014 Revenue down 11% in 1H 2014 Toolbars and Apps Queries include B2C and B2B, as well as downloadable applications queries from Ask.com 11% 15%

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Distribution partners are struggling, posting sequential declines and losing distribution to competitors, hurting revenues in the B2B segment Applications What Can we Expect? The recent transition required by a new version of Chrome is having an adverse effect on the segment A BAD COMPANY IACI’s other segments dramatically mitigate the projected share price decline

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“To use a bad analogy, it's like a gateway. You use Tinder and suddenly you've done it. It works, you say, Oh, this is great. And then suddenly, you're willing to do all these things. And that's happening globally. And so I think that the category is going to get very large.” – Gregory Blatt, Chairman of Match Group Project monetization of Tinder yielding $75mm in EBITDA by 2018 (analysts project $75mm in 2015) Monthly Active Users has grown at a rate of 60%, potentially leading to uptick in future subscriber growth Dating websites offer a tremendous amount of operating leverage Overall Match Making Industry is expected to grow 5% 1 Match Subscribers and Rev/Subscriber Growth Drivers (1) Source: IBISWorld

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Match Group: Operating Leverage

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eCommerce and Media

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eCommerce Segment Description Segment down 16% last year Hit by CityGrid (excluding this portion, segment would have been positive) HomeAdvisor increased revenue and service requests by 20% Management expects Tutor.com to take advantage of cost and revenue synergies

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Spin-off Optionality Barry Diller Chairman and Senior Executive, InterActiveCorp History of spin-offs Barry Diller, Chairman and Senior Exectuvie, has a long history of creating shareholder value through spin-offs. His previous spin-offs include Expedia (EXPE) and TripAdvisor(TRIP) “I am the Spin Master” Value for Shareholders There is a reason why investors have been asking about the possibility of a Match Group Spin-off for years in earnings calls: On average, shareholders gain 15.63% value after spin-offs 1 Potential Match Group Spinoff Investors have been asking about the possibility of a Match Group spin-off in earnings calls for years In late 2013 Barry Diller installed a separate management team for Match Group, possibly setting it up for a spin-off IAC no longer has a CEO: Search & Applications, Match Group and Media segments each of a CEO reporting to Diller (1) Source: M.D. Hamid Uddin, University of Sharjah